Snap investors eagerly anticipate the latest updates on the social media app’s business performance. However, some analysts express concerns that its best days of growth may be behind it.
According to FactSet, analysts’ consensus for Snap (ticker: SNAP) in the third quarter is a projected loss of 24 cents per share on revenue of $1.11 billion, with 405.8 million daily active users (DAU). Moving forward to the current fourth quarter, estimates suggest a loss of 16 cents per share on revenue of $1.34 billion, with DAU numbers reaching 414.5 million.
Market Perform Rating
Bernstein analyst Mark Shmulik recently restated his Market Perform rating for Snap stock, reinforcing his $11 price target.
Shmulik points out that although Snap has made progress with its ad technology, there has been a decline in spending by top advertisers. Additionally, domestic user engagement on the app seems to be facing challenges.
App Downloads Decline
Apptopia data shows that Snap app downloads have fallen by 3% year over year during the September quarter. This decline in downloads could indicate potential hurdles for the company’s growth and engagement metrics.
Recent Stock Performance
Snap stock experienced a rally last week following a report by the Verge, which detailed CEO Evan Spiegel’s internal memo on the company’s stretch goals for the upcoming year. However, despite this rally, the company’s shares have still seen a 24% decrease over the past three months.
In Monday afternoon trading, Snap stock saw a 3% increase, currently standing at $9.73.
As Snap prepares to release its latest business updates, investors are navigating market expectations amid concerns about growth sustainability. The decline in app downloads and user engagement numbers pose challenges for the company. However, recent reports on CEO Evan Spiegel’s goals indicate potential opportunities for future performance.